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Residual income refers to the income generated based on the production of others within an organisation. The residual income will therefore differ from business to business as it is dependent upon the number of people an individual is accountable for and rates also differ across different companies.

This being the case, an initial starting point for anyone looking to take advantage of any residual income business opportunities would be to select a reputable franchise with established staff who will inform the franchisee of the intricacies of running such a business venture. It is important that everything is done to fully understand the business environment before starting up a residual income venture.

In theory, a residual income business opportunity rests on the performance of others as well as your own and so it is necessary to maintain strong communication links between franchisee and franchiser, as well as among the franchisees themselves.

Someone with dedication who is hard working and persistent would be ideal for such an opportunity. As income is linked to performance, it is therefore imperative that production is maximised and to do so successfully, a good amount of planning needs to be put into practice so that every eventuality is covered. Contingency plans are, for this reason, vital aspects of the planning process and will make the implementation of changes that little easier.

Franchises offer the huge benefit of a proven system of operations and it is a tried and tested business method that is perhaps the greatest advantage to setting up any franchise. A good franchiser will provide effective training, marketing tools and local sales/marketing support to make the transition period as painless as possible. As a result, it is this introductory package and ongoing advice that can mean franchisees start in the business world with an effective framework from which to build.

A residual income business opportunity can be located anywhere. It could be run from home or from an office. Therefore it is important to decide which location suits which franchisee. In terms of residual income, this perhaps takes on greater significance due to the fact that income is changeable and very much tied in with the success of a location. The customer must be targeted to maximum effect and a large part of this links to the ease in which they can access a company's services or product.

One avenue to be explored could be website franchise opportunities that pay a residual income. The internet as a tool for profit making cannot be underestimated. It continues to grow and the acquisition of entertainment-sharing website YouTube by Google for £883 million ($1.65 billion) in October 2006 goes to prove the huge potential in this market.

An example would be UK On The Web, a company that offers programming, brand development and web ideas to a range of clients. For an outlay of £4995 ($9,300), the franchisee is then responsible for the running of a website that returns 100 per cent of all sales generated – meaning big money if a successful formula is developed. Revenue streams will come from advertising and the more work put in, the more money a residual income business such as this could bring in.

Copyright Adfero Ltd 2006

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